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Delivering Broadband Mobility on the Go

Posted on November, Thursday 24, 2011 By itVAR News Network

As different operators in the telecom domain concentrate on a WiMAX business case for licensed spectrum, the frequency being used for spectrum is unquestionably the primary asset for a service provider.

In some cases an operator may be putting together a business case in order to determine how much bandwidth would be necessary to support a long term network operation that can expand on different levels. Hence a comprehensive business case exercise is critical for the successful adoption of Wimax business model.

How would the usage of 2.3GHz or 2.5GHz spectrum or even 1.7GHz or 700MHz range affect the business case results for a Wimax adoption in a country like India? Determining not only the availability of spectrum, but also the total bandwidth available are critical inputs to the development of a water-tight business case. With this detailed information, service providers and telcos can decide whether to use a channel bandwidth of 5MHz, 10MHz or 20MHz. 

Wimax adoption becomes especially critical for Indian geography as most of the regions are not that connected to the national communications infrastructure or the IT backbone. Hence, the operators need to develop and sustain a Wimax business case scenario.

While developing the business case for Wimax, for each operator deployment, the financial assumptions and parameters need to be customized to a regional and local level. They also need to understand the interest rate on borrowing and return on cash capital need to be determined well in advance. On the other hand, the tax rate structure on corporate profit as well as taxes on revenue, also need to be specified as a part of the financial assumptions. 

When it comes to telcos financial take on Wimax, capital expenditures consist of the cost to acquire or lease sites. These may be existing sites through collocation agreements or even greenfield sites. There may be fixed costs as well as monthly recurring costs associated with site acquisition. The Access Network assumptions are next. These include not only the cost of the base stations, but also the cost to install and connect every component in the access network, from cabling to antennae to power and backhaul. 

The costs for Wimax backhaul provisioning, installation and operation also need to be considered thoroughly. Moving forward, Wimax is sure to be a big connectivity force for the rural parts of a country like India, however, operators need to incorporate better planning and analyze the market dynamics in a better manner.  

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